Overview
On-chain governance is governance where proposals and votes happen directly on the blockchain. It automates execution of decisions. It provides transparency and immutability.
How It Works
Token holders submit and vote on proposals on-chain. Passing proposals execute automatically, such as parameter changes or fund transfers. Voting power is typically token-weighted.
Why It Matters
On-chain governance ties decisions to execution, reducing delay and trust. It is common in protocols with treasury management. Its challenges include low participation and governance attacks.
Related Concepts
On-chain governance relates to DAOs, Governance Tokens, and Proposals. It contrasts with Off-Chain Governance.